External Member of the Financial Policy Committee of the Bank of England

Body: Bank of England
Appointing Department: HM Treasury
Sector: Regulation
Location: City of London
Skills required: Regulation
Number of Vacancies: 1
Remuneration: Total compensation will be £97,200 p.a. This figure will be reviewed annually by the Bank’s Remuneration Committee.
Time Requirements: Part-time commitment of, on average, 23 days a quarter (though actual experience can vary considerably).

Campaign Timeline

  • Competition Launched

    16/10/2020

  • Closed for Applications

    29/11/2020

  • Panel Sift

    December TBC

  • Final Interview Date

    January TBC

  • Announcement

    TBC

Vacancy Description

The Bank

The Bank of England is the central bank of the United Kingdom; it exists to ensure monetary stability and to protect and enhance financial stability. The Bank employs around 4,400 staff and has a total gross expenditure of around £640 million per annum.

The statutory objectives of the Bank of England, which are set out in the Bank of England Act 1998, are:

Financial Stability

Financial stability entails detecting and reducing threats to the financial system as a whole. Such threats are detected through the Bank’s surveillance, market intelligence and supervisory functions, which include the Prudential Regulation Authority. The Financial Policy Committee is responsible for contributing to the Bank’s financial stability objective by identifying and monitoring systemic threats to financial stability and taking action to reduce or remove those threats. On behalf of the Court of Directors, it determines the Bank’s Financial Stability Strategy.

Other parts of the Bank also have a role in mitigating threats to financial stability, for example by strengthening infrastructure, and by financial and other operations at home and abroad, including, in exceptional circumstances, by acting as the lender of last resort.

The Financial Services Act 2012 brought together responsibility for all aspects of financial stability within the Bank of England. The Act strengthened the Bank’s financial stability objective, and created both the Financial Policy Committee as a policy committee within the Bank and the Prudential Regulation Authority as a subsidiary of the Bank. The Bank of England and Financial Services Act 2016 provided for the Prudential Regulation Authority to be incorporated within the Bank and the establishment of a Prudential Regulation Committee.

Monetary Stability

Monetary stability means stable prices and confidence in the currency. Stable prices are defined by the Government’s inflation target, which the Bank seeks to meet through the decisions on interest rates and asset purchases taken by the Monetary Policy Committee, explaining those decisions transparently and implementing them effectively in the money markets.

Further information on the Bank of England’s objectives and committees is available in the attached candidate pack.

 

The Financial Policy Committee (FPC)

The FPC was established as a committee of the Bank by the Financial Services Act 2012.

The membership of the FPC comprises the Governor (who chairs the FPC), the four Deputy Governors, the Chief Executive of the Financial Conduct Authority, the Bank’s Executive Director for Financial Stability Strategy and Risk, five external members appointed by the Chancellor, and a non-voting member from HM Treasury (see Appendix II of the attached candidate pack for biographies of the FPC members).

The FPC exercises its functions with a view to contributing to the achievement of the Bank’s financial stability objective. The FPC is responsible for identifying, monitoring and taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system. The FPC also has a secondary objective to support the Government’s economic policies.

The FPC has wide-ranging powers of recommendation and can direct the Prudential Regulation Authority and the Financial Conduct Authority to take action to address systemic risks to financial stability.

The appointment of external members to the FPC is designed to ensure that the Committee benefits from thinking and expertise in addition to that existing inside the Bank of England, and to provide constructive challenge during the Committee’s deliberations. Each member of the FPC should have expertise in the field of financial services and economics. External members will be independent – they will not represent or lobby for individual groups, interests or sectors.

FPC Objectives

The FPC has responsibility for formulating macroprudential policy. As set out in the Bank of England Act 1998, as amended by the Financial Services Act 2012, the objectives of the FPC are:

  • to contribute to the achievement by the Bank of its financial stability objective by identifying, monitoring and addressing systemic risks with a view to protecting and enhancing the resilience of the UK financial system; and subject to that
  • to support the economic policy of Her Majesty’s Government, including its objectives for growth and employment.

Committee Meetings

The FPC usually meets quarterly for a series of meetings (usually held in March, June, September and November). The Committee aims to set policy by consensus but will vote if a consensus cannot be reached. In advance of policy meetings, the FPC receives extensive briefing on the economy and the financial system from Bank of England and Financial Conduct Authority (FCA) staff. This includes briefing and issues meetings which usually take place in the two weeks before the FPC’s policy setting meeting. The members of the Committee are made aware of all the latest data and hear explanations of recent trends and analysis of relevant issues. The Committee is also told about the relevant regulatory issues by Bank and FCA staff.

Public Communications

The Financial Services Act 2012 requires the FPC to explain its thinking and decisions publicly in detail. A record of FPC meetings is normally published two weeks after policy meetings. The record gives a full account of the policy discussion, including differences of view. The record also sets out the votes, if any, of the individual members of the Committee. The Committee explains its actions regularly to parliamentary committees, particularly the Treasury Committee. FPC members are also expected to speak to audiences throughout the country, to explain the FPC’s policy decisions and thinking.

In addition to the FPC meeting records, the FPC publishes a Financial Stability Report (FSR) bi-annually. The FSR contains the FPC’s assessment of the strength and weaknesses of the UK financial system and the Committee’s outlook for the stability of the system. The report also sets out a summary of the action taken by the FPC since the previous report and an assessment of how those actions have contributed to the FPC’s objectives.

The Financial Services Act 2012 requires that the FPC publish explanations for its policy decisions and these explanations will be published in the FSR.

 

Person Specification

This is a high-profile and influential role. As set out in legislation, the Chancellor of the Exchequer will appoint an external member to the FPC only if he is satisfied that the person has knowledge or experience which is likely to be relevant to the Committee’s functions.

In making external appointments to the FPC, the Government will seek to ensure that the composition of the Committee provides an appropriate balance of different skills and backgrounds and is keen to increase the diversity on the Committee. The appointment of external members to the FPC is designed to ensure that the Committee benefits from thinking and expertise in addition to that gained inside the Bank of England.

The requirements for this role are as follows:

Experience in financial stability policy making and/or regulationcandidates must have the technical expertise and experience necessary in order to make independent macroprudential decisions.  Candidates should demonstrate that they have used their expertise operating at a very senior level in financial regulation/ policy making, for example in central banking or at an international financial institution.

Excellent interpersonal and communication skills – candidates must be able to communicate with complete credibility in the markets and the media and be able to defend decisions under pressure. Candidates must be able to make a strong contribution to the FPC’s communications, explaining policy decisions to the public.

Undisputed integrity and standing – the ability to maintain discretion and engender trust with a willingness to abide by the necessary conflict of interest constraints.

A solid understanding of economics – candidates must be able to demonstrate that they can consider the economic factors in the Committee’s decision making. Candidates should demonstrate that they can apply economic knowledge in areas related to financial policy or macroeconomic issues.

Analytical ability – candidates must have analytical ability, and the ability to absorb large amounts of complex information and reach reasoned and robust conclusions.

Independence of thought – candidates must be able to exert influence within the Bank, FPC and in wider external policy debate and be comfortable forming personal views whilst working closely and constructively with FPC members.

Operational risk – a strong understanding of operational risk, including cyber risk.

 

Additional Information

External members of the FPC are appointed by the Chancellor of the Exchequer. External appointments to the FPC are for a three-year term. There is the possibility of reappointment at the end of the term and external members can serve a maximum of two terms.

It is expected that the appointment will commence in time for the Q2 FPC round of meetings in June 2021.

Under the Bank of England Act 1998, a person is disqualified from being an external member of the FPC if he or she is (a) Minister of the Crown; or (b) serving in a Government department in employment in respect of which remuneration is payable out of money provided by Parliament.

External members of the FPC are appointed by the Chancellor as officer-holders at the Bank of England. The Court of the Bank sets the terms of their appointment. The contract is fixed term and non-pensionable for the term of the appointment plus a three month “purdah” period on expiry of the fixed term. It requires a part-time commitment of an average 23 days a quarter, though actual experience can vary considerably. For the period of the appointment and during the purdah period, FPC members are bound by the Bank’s conflicts of interest code – which covers potential conflicts on appointment as well as subsequently – and are required to abide by the Bank’s rules on personal financial transactions as well as its general code of business ethics (“Our Code”) and guidance on external communications.

External FPC members are not required to hold UK nationality.

FPC meetings normally take place at the Bank’s head office in Threadneedle Street in the City of London. The bank will continue to follow public health advice following the coronavirus (COVID-19) outbreak, including holding meetings virtually where necessary.

Please see the attached candidate pack for further details of this appointment.

 

How to Apply

The details and forms you are required to complete as part of the application are explained below, with the relevant forms listed in Appendix IV of the attached candidate pack. These documents are available on the Centre for Public Appointments website.

Applications must be submitted to the following email address: App4@egonzehnder.com

You need to provide the following information:

  • Contact numbers and e-mail addresses, which will be used with discretion.
  • A full CV (including education and professional qualifications, career history, and relevant achievements and responsibilities).
  • The names of two referees should be included in the CV. Referees should know you in a capacity to comment on your suitability for the appointment and have authoritative and personal knowledge of your achievements. References will only be taken up for short listed candidates but will be sought prior to the interview.
  • A covering letter of no more than three sides of A4 explaining how you meet the appointment criteria as detailed in the candidate profile and summarising the evidence from your career which best demonstrates your qualifications for the appointment. If you believe you may have a potential conflict of interest please do flag this in the cover letter, as it may be explored at interview.
  • You will also be asked to complete a questionnaire regarding your contact details, guaranteed interview scheme, conflicts of interest, and political activity, and a diversity monitoring form. Information submitted in the diversity monitoring form is required for monitoring purposes only and will not be seen by any selection panel. HM Treasury’s Public Appointment Recruitment Privacy Notice is annexed to this candidate pack. A copy of Egon Zehnder’s private policy can be found at: https://www.egonzehnder.com/privacy-policy.

Your application will be acknowledged shortly after receipt and you will be informed by email or by telephone of the progress of your application.

Applications must arrive no later than 11pm GMT on 29th November

If you have any queries concerning your application, or technical queries on completing the application, please email App4@egonzehnder.com or call +44 20 7943 1912.

 

Appointment Process

Once the closing date for applications has passed, applications will be sifted according to the candidate profile. Those applicants who have not been successful will be notified at this stage and a short list of the most qualified applicants will be invited to final panel interviews, which will be held in London.

The closing date for applications is 29th November. Interviews are expected to take place in January. It is expected that the appointment will be made during Q1 of 2021, in time for the Q2 2021 FPC round beginning in June 2021.

Expenses

If you are invited for interview, reasonable and necessary travel expenses (standard class) will be reimbursed. Those invited to interview will be advised on how to claim their expenses.

Equality of Opportunity

The Bank of England and HM Treasury have strong commitments to diversity and equality of opportunity, and welcome applications from candidates irrespective of their background, gender, race, sexual orientation, religion, or age, providing they meet the required criteria. Both HM Treasury and the Bank are signatories to the Women in Finance Charter and applications from women and BAME candidates are particularly encouraged.

All disabled candidates (as defined by the Equality Act 2010) who satisfy the minimum criteria for the role will be guaranteed an interview under the Disability Confident Scheme (DCS).

To be eligible for consideration under the DCS, you must be considered disabled under the Equality Act 2010. This means that you must have or have had in the last 12 months – a physical or mental impairment which has a substantial long-term adverse effect on your ability to carry out normal day-to-day activities. This includes those whose disability has lasted, or is likely to last, for 12 months, or if the disability or condition is likely to progress or recur.

If you wish to apply under the DCS, then please complete Section 2 of the Disability Confident, Political Activity, and Conflict of Interest form included as part of this pack.

Egon Zehnder Consultant Contacts

If you have any further questions about this appointment, please reach out to one of the following Egon Zehnder consultants:

Simon Page

Direct: +44 20 7943 1812

Mobile: +44 7876 477 852

Email: simon.page@egonzehnder.com

Loula Lefkaritis

Direct: +44 20 7943 1921

Mobile: +44 7342 050 336

Email: loula.lefkaritis@egonzehnder.com

Neill Hunt

Direct: +44 20 7943 5918

Mobile: +44 7341 027 083

Email: neill.hunt@egonzehnder.com

Attachments
Disabilty Conflicts and Political Activity Questionnaire 2020
Diversity Monitoring Form FINAL
Public Appointment Recruitment Privacy Notice
FPC Candidate Pack
Disabilty Conflicts and Political Activity Questionnaire 2020
FPC Candidate Pack

This post is NOT regulated by The Commissioner for Public Appointments.

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